A general introduction to procurement process:
Before introducing Tenders Electronic Daily (TED), it is better to introduce these complicated but immensely important notions in the business world called procurement and tendering.
what is procurement process:
First, a foundational concept in the investment world like procurement needs deep understanding. The latter is the procedure of purchasing products or acquiring services. Subsequently, the buyer in order to choose one suitable supplier launches a tendering procedure. Suppliers would apply for the tender and provide their best bids (or quotes). In certain cases, the procurement has multiple layers of selection. Therefore, bidders will have to undertake other phases before the pre selection stage such as call for expression of interest or invitation to provide a proposal (IPP) and pre-qualification questionnaire (PQQ) etc. these mentioned examples are going to be explained in the next section. After the long selection procedure, the shortlisted candidates would undergo another scrutiny. Final stage is the announcement of the contract winner.
Many notions have to be clarified as tendering is a deep and complicated arena of business investment. Thus, the next section is like an introductory glossary terms to procurements and tendering sphere.
This section is not a wholesome cover of the terms related to tendering. However, we are going to try to display major notions and steps before getting shortlisted. It is true that the processes of procurements are long and exhausting but they are worthy. To put it in the right frame we are going to explore the terms related to governmental tenders. The following terms are organized chronologically and according to certain logic.
- PQQ: It is the abbreviation of the clause Pre-qualification questionnaire. This pre-qualification process is in the form of a set of queries to guide the buyers to a better and more specified selection. The pre questionnaire helps to narrow the selected candidates’ number for efficiency reasons.
- IEI: It is the abbreviation of Initial Expression of Interest. Also sometimes called PIN (prior information notice). Chiefly used in governmental procurement publications. It is when procurers ask concerned candidates or parties to indicate their interest in offering bids whenever the bidding process will be inaugurated.
- IPP: It is the abbreviation of an invitation to provide a proposal. Seemingly, after the first pre-qualification stage came another more narrowed selection. In this phase, selected tenderers are invited to provide proposals, offers or quotes for the procurement. The aim of this stage is to be even more selective and meticulous. Hence, the buyer would know very well the capacities and horizons of the bids they will get.
- ITT: It is the abbreviation of invitation to tender. Automatically, this could happen only if the potential tenderers are selected to provide the final bids. In this phase, the suitable documents are sent to shortlisted tenderers whether electronically or via postal address. The documents issued in this phase are generally, the features and rules of the tender, the contract policy and requirement, final inquiries and information needed for the contract.
- Contract award: It is the last stage of the procedure. It happens when the final bidders are shortlisted. Then the buyer ranks all the listed candidates. At that point, the highest ranked and evaluated bidder is the contract winner.
Standards, criteria and requirement:
Any procurement is built upon specific requirement of purchase. The requirements touch upon the products themselves, the quality, the price and the after sale services. A procurement is a long run agreement between a buyer and a seller so the relationship should be solid and consistent. The buyer sets always points of ranking for each requirement. Accordingly, the bidders are ranked and the more points you get for your bid the better chances you have to be winner. For these reasons, the following are the most highlighted standards requested in any procurement selection.
- Technical proficiency: Any procurer would like to have trustworthy technical support for the purchased products. The support should be reliable, continuous and efficient.
- The schedule of execution of the project is tremendously important. The potential contract winner should maintain a strong grasp on the notion of time. The capability to abide by deadlines is decisive.
- Relationship price and quality has the highest appealing factor for the procurer. That is why a tenderer should pay a great attention to his proposed bid and to quality standards.
- On-site installation, control and support are also a great sign of professionalism and accuracy that any procurer would like to have when they sign the contract.
- Tender evaluation is built upon the efficiency of the equipment and technological advancement too. In addition, we have to accentuate that the power of a good planning and crisis management plans are taken into great consideration.
TED as a case study:
TED is the abbreviation of an online procurement website called Tenders Electronic Daily. This website focuses only on European governmental procurements. The website displays a tremendous number of electricity tenders, renewable energy tenders and energy tenders in general.
- Definition of the website: The website has a capacity of about 520 thousand procurement publication per year. This huge number is roughly €420 billion value of business opportunities. The website affords an unrestricted, non-binding and free of charge services. It covers the European arena and sometimes further. Except of Sunday and Monday, TED publishes daily procurements. The rate of publications, calls for expressions of interests and contract notices is about 2000 publication per 5 days.
- Benefits of the website: Every day the website provides considerable number of electrical tenders, which are real business opportunities any electrical equipment supplier or electrical services company can dream of. In addition to its free services, TED is a portal of infinite links to other public procurement websites. Furthermore, the European website gives extensive information and useful searching and filtering options. The browsing mechanism is easy and filtered by regions, sectors and type of business opportunities. The documents of information of any procurement’s notices are translated to multiple languages, more precisely to 24 European languages.